Welcome to strategy #6 of the Real Estate investing for under $1000 series. Today we’re going to talk about the rise of online real estate marketplaces that have revolutionized the way we invest in properties, making investing in real estate accessible to a broader range of investors with varying budget sizes.
The Birth of Online Real Estate Marketplaces: A Paradigm Shift
As you know, traditionally, investing in real estate meant purchasing an entire property or committing a substantial sum of money to a real estate project. This approach excluded many individuals who lacked the financial resources to invest in this way. Enter online real estate marketplaces – platforms designed to democratize real estate investing by allowing investors to pool their resources and invest in properties collectively. These platforms offer a range of investment models, including fractional ownership and rental income-sharing arrangements, making it possible to enter the real estate market with a low minimum investment requirement. We’ve already talked about some such platforms in our Crowdfunding and Micro-Investing App episodes, but let’s dive in to see how you can utilize some other resources.
Fractional Ownership: Sharing the Real Estate Pie
One of the groundbreaking concepts brought to life by online real estate marketplaces is fractional ownership. This model enables investors to own a percentage of a property rather than the entire thing. This way, the cost of purchasing a property is distributed among multiple investors, lowering the entry barrier and enabling a more diverse range of people to become real estate investors. Fractional ownership is particularly appealing for high-value properties that would otherwise be out of reach for individual investors.
A while back I did an episode with Elise Alexander at AceTrader and we talked about investing in Farmland. This platform and investing style is a perfect example of fractional ownership investing.
Rental Income-Sharing: Profits Without the Landlord Role
Another innovative approach is the rental income-sharing model. In this scenario, investors contribute to the purchase of a property, and as the property generates rental income, the profits are distributed proportionally among the investors. This method not only provides an additional stream of income but also eliminates the responsibilities and headaches associated with being a landlord, such as property management, maintenance, and tenant relations.
Advantages of Online Real Estate Marketplaces
I’ve mentioned this before, but here are the advantages of using online real estate marketplaces:
Considerations Before Diving In
While the concept of online real estate marketplaces is undoubtedly exciting, potential investors should exercise caution and conduct thorough research before making any financial commitments. Here are a few factors to consider:
There are several online real estate marketplaces that offer opportunities for investors to participate in real estate through fractional ownership or other innovative models. Keep in mind that the availability of these platforms can vary by region and over time, so it’s a good idea to do your own research to find the most up-to-date options. Here are a few prominent platforms I found:
Online real estate marketplaces have transformed the way people invest in real estate, opening doors for a wider range of investors to participate in this lucrative asset class. Fractional ownership and rental income-sharing models provide flexibility, reduced commitment, and the potential for significant returns. However, as with any investment, due diligence is crucial. Carefully research platforms, properties, and associated costs to ensure you’re making informed decisions that align with your financial goals. With the right approach, online real estate marketplaces can be a powerful tool for diversifying your investment portfolio and tapping into the world of real estate.
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Moneeka Sawyer is often described as one of the most blissful people you will ever meet. She has been investing in Real Estate for over 20 years, so has been through all the different cycles of the market. Still, she has turned $10,000 into over $5,000,000, working only 5-10 hours per MONTH with very little stress.
While building her multi-million dollar business, she has traveled to over 55 countries, dances every single day, supports causes that are important to her, and spends lots of time with her husband of over 20 years.
She is the international best-selling author of the multiple award-winning books “Choose Bliss: The Power and Practice of Joy and Contentment” and “Real Estate Investing for Women: Expert Conversations to Increase Wealth and Happiness the Blissful Way.”
Moneeka has been featured on stages including Carnegie Hall and Nasdaq, radio, podcasts such as Achieve Your Goals with Hal Elrod, and TV stations including ABC, CBS, FOX, and the CW, impacting over 150 million people.